A Pentagon inspector general's investigation last year found that O'Reilly regularly yelled and screamed at subordinates, often in public, demeaned and belittled employees and behaved in such a way as to result in the departure of at least six senior staffers from the Missile Defense Agency during his time as its director.

Panetta determined that O'Reilly had met the basic standard for being allowed to retire without a loss in rank, which is that he "served satisfactorily" as a three-star.

However, Panetta also placed in O'Reilly's permanent file a letter of reprimand, according to a senior defense official. The official, who disclosed the reprimand on condition of anonymity because it will not be publicly announced, said the letter states that Panetta disapproves of O'Reilly's management and behavior as head of the Missile Defense Agency.

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